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Chapter 1- slide 1Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

Chapter One

Marketing: Creating and Capturing Customer Value


Creating and Capturing Customer Value

• What Is Marketing?• Understand the Marketplace and Customer Needs• Designing a Customer-Driven Marketing Strategy• Preparing an Integrated Marketing Plan and Program• Building Customer Relationships• Capturing Value from Customers• The Changing Marketing Landscape

Topic Outline


What Is Marketing?

Marketing is a process by which companies create value for customers and build strong customer relationships to capture value from customers inreturn


The ________ is the nation’s twenty-fourth largest advertiser with an annual budget of more than $1 billion.1. Procter & Gamble Company2. Boeing Company3. Levi Strauss & Co.4. U.S. Government


The ________ is the nation’s 24th largest advertiser with an annual budget of more than $1 billion.1. Procter & Gamble Company2. Boeing Company3. Levi Strauss & Co.4. U.S. Government


What Is Marketing?The Marketing Process


Understanding the Marketplace and Customer Needs

• Customer needs, wants, and demands• Market offerings• Value and satisfaction• Exchanges and relationships• Markets

Core Concepts


Marketing is ___________.1. the same as advertising and sales2. not used by small corporations3. about satisfying customer needs4. making a profit


Marketing is ________.1. the same as advertising and sales2. not used by small corporations3. about satisfying customer needs4. making a profit


Marketing is ________.1. part of manufacturing2. part of the finance department3. managing customer relationships4. sales promotion


Understanding the Marketplaceand Customer NeedsCustomer Needs, Wants, and Demands


The most basic concept underlying marketing is that of ________.1. profits2. products3. human needs4. services


Understanding the Marketplaceand Customer Needs

• Market offerings are some combination of products, services, information, or experiences offered to a market to satisfy a need or want

• Marketing myopia is focusing only on existing wants and losing sight of underlying consumer needs



Customer Value and SatisfactionExpectations


Exchange is the act of obtaining a desired object from someone by offering something in return




Markets are the set of actual and potential buyers of a product


Designing a Customer-Driven Marketing Strategy

Marketing management is the art and science of choosing target markets and building profitable relationships with them– What customers will we serve?– How can we best serve these customers?


The art and science of selecting target markets and developing profitable relationships with those markets is called marketing ________.1. profiles2. maneuvers3. selection4. management



Market segmentation refers to dividing the markets into segments of customers

Target marketing refers to which segments to go after

Selecting Customers to Serve



Demarketing is marketing to reduce demand temporarily or permanently; the aim is not to destroy demand but to reduce or shift it

Selecting Customers to Serve



Choosing a Value Proposition

The value proposition is the set of benefits or values a company promises to deliver to customers to satisfy their needs


The set of benefits/values a company promises to its customers is called __________.1. value proposition2. advertising3. supply and demand4. production concept


Designing a Customer-Driven Marketing StrategyMarketing Management Orientations



Production concept is the idea that consumers will favor products that are available or highly affordable

Marketing Management Orientations



Product concept is the idea that consumers will favor products that offer the most quality, performance, and features. Organization should therefore devote its energy to making continuous product improvements.




Selling concept is the idea that consumers will not buy enough of the firm’s products unless it undertakes a large scale selling and promotion effort





Marketing concept is the idea that achieving organizational goals depends on knowing the needs and wants of the target markets and delivering the desired satisfactions better than competitors do




Societal marketing concept is the idea that a company should make good marketing decisions by considering consumers’ wants, the company’s requirements, consumers’ long-term interests, and society’s long-run interests


Human welfare, want satisfaction, and profits are the three considerations underlining the concept known as ________.1. societal marketing2. customer-driven3. sales-driven4. production


Which marketing philosophy purports that achieving corporate goals depends on knowing the needs/wants of your markets and delivering the desired satisfactions better than your competitors?1. Production concept2. Product concept3. Selling concept 4. Marketing concept


The marketing mix is the set of tools (four Ps) the firm uses to implement its marketing strategy.It includes product, price, promotion, and place.

Integrated marketing program is a comprehensive plan that communicates and delivers the intended value to chosen customers.

Preparing an Integrated Marketing Plan and Program


Building Customer Relationships

• The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction

Customer Relationship Management (CRM)


Building Customer RelationshipsRelationship Building Blocks: Customer Value and Satisfaction


To build lasting customer relationships, organizations should focus on delivering ________ and ________.1. high quality products; low prices2. customer value; customer satisfaction3. customer satisfaction; customer growth4. customer value; high profits


Building Customer RelationshipsCustomer Relationship Levels and Tools



• Relating with more carefully selected customers uses selective relationship management to target fewer, more profitable customers

• Relating more deeply and interactively by incorporating more interactive two way relationships through blogs, Websites, online communities and social networks

The Changing Nature of Customer Relationships


Partner relationship management involves working closely with partners in other company departments and outside the company to jointly bring greater value to customers




• Partners inside the company is every function area interacting with customers– Electronically– Cross-functional teams

• Partners outside the company is how marketers connect with their suppliers, channel partners, and competitors by developing partnerships

Partner Relationship Management



• Supply chain is a channel that stretches from raw materials to components to final products to final buyers

• Supply management• Strategic partners• Strategic alliances

Partner Relationship Management


Capturing Value from Customers

• Customer lifetime value is the value of the entire stream of purchases that the customer wouldmake over a lifetime of patronage

Creating Customer Loyalty and Retention



Share of customer is the portion of the customer’s purchasing that a company gets in its product categories

Growing Share of Customer



Customer equity is the total combined customer lifetime values of all of the company’s customers



• Building the right relationships with the right customers involves treating customers as assets that need to be managed and maximized

• Different types of customers require different relationship management strategies– Build the right relationship with the right

customers

Building Customer Equity


The New Marketing Landscape

Major Developments


So, What Is Marketing? Pulling It All Together


Which of the first four steps of the marketing process asks, “What consumers will we serve?” and “How can we best serve targeted customers?”1. Step 1: Understanding the marketplace2. Step 2: Designing the marketing strategy3. Step 3: Constructing the marketing program4. Step 4: Building profitable relationships with customers


Which step of the marketing process is the most important?1. Step 1: Understanding the marketplace2. Step 2: Designing the marketing strategy3. Step 3: Constructing the marketing

program4. Step 4: Building profitable relationships

with customers


Which step of the marketing process is the most important?1. Step 1: Understanding the marketplace2. Step 2: Designing the marketing strategy3. Step 3: Constructing the marketing program4. Step 4: Building profitable relationships

with customers


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mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.

Copyright © 2010 Pearson Education, Inc. Copyright © 2010 Pearson Education, Inc. Publishing as Prentice HallPublishing as Prentice Hall

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